A BILL to repeal §5-16-7b of the Code of West Virginia, 1931, as
amended; to repeal §5-16C-1, §5-16C-2, §5-16C-3, §5-16C-4,
§5-16C-5, §5-16C-6, §5-16C-7, §5-16C-8, §5-16C-9 and §5-16C-10
of said code; to repeal §5A-3-1a of said code; to repeal
§5A-3C-1, §5A-3C-2, §5A-3C-3, §5A-3C-4, §5A-3C-5, §5A-3C-6,
§5A-3C-7, §5A-3C-8, §5A-3C-9, §5A-3C-10, §5A-3C-11, §5A-3C-12,
§5A-3C-13, §5A-3C-14, §5A-3C-15, §5A-3C-16 and §5A-3C-17 of
said code; to amend said code by adding thereto a new article,
designated §5-16D-1, §5-16D-2, §5-16D-3, §5-16D-4, §5-16D-5,
§5-16D-6, §5-16D-7, §5-16D-8, §5-16D-9, §5-16D-10, §5-16D-11,
§5-16D-12, §5-16D-13, §5-16D-14, §5-16D-15, §5-16D-16,
§5-16D-17, §5-16D-18, §5-16D-19, §5-16D-20, §5-16D-21,
§5-16D-22, §5-16D-23, §5-16D-24, §5-16D-25, §5-16D-26,
§5-16D-27, §5-16D-28, §5-16D-29 and §5-16D-30; to amend and
reenact §5F-2-2 of said code; and to amend and reenact
§29-22-18a of said code, all relating generally to the creation of the Office of the Pharmaceutical Advocate;
legislative findings; defining terms; powers and duties of the
Office of the Pharmaceutical Advocate; creation of the
cabinet-level position of the Pharmaceutical Advocate;
qualifications and salary of the Pharmaceutical Advocate;
powers and duties of the Pharmaceutical Advocate; creation of
the Pharmaceutical Advisory Council; qualifications of Council
members; powers and duties of the Council; reporting
requirements of the Council, the Pharmaceutical Advocate and
the Office of the Pharmaceutical Advocate; transferring powers
and duties of the West Virginia Public Employees Insurance
Agency to negotiate for and purchase pharmaceuticals to the
Pharmaceutical Advocate; repealing the Prescription Drug Costs
Management Act; transferring the powers and duties to
negotiate and execute prescription drug purchasing agreements
to the Pharmaceutical Advocate; transfer of the powers and
duties to negotiate and execute pharmacy benefit management
contracts to the Pharmaceutical Advocate; exempting the
Pharmaceutical Advocate from state purchasing requirements;
authority to investigate the feasibility of purchasing
Canadian drugs; authority to investigate multistate discussion
groups and agreements; transfer of the Clearinghouse Program
to the Pharmaceutical Advocate; transfer of the Pharmaceutical
Discount Program to the Pharmaceutical Advocate; authorizing
the Pharmaceutical Advocate to take advantage of Acts of
Congress, accept gifts, grants and matching funds; continuing agency management ability until the Office of the
Pharmaceutical Advocate is operational; prohibiting restraint
of trade; providing civil and criminal penalties for restraint
of trade; reporting of advertising costs to the Pharmaceutical
Advocate; state role and responsibilities; participation by
all state agencies who are payors for prescription drugs;
authority for the Pharmaceutical Advocate to investigate
participation in a preferred drug list by private individuals,
commercial insurance carriers and self-insured companies;
rule-making authority; identifying potential use of savings;
sunset provisions; severability provision; repeal of the
Pharmaceutical Availability and Affordability Act; transfer of
the powers and duties of the West Virginia Pharmaceutical Cost
Management Council to the Office of the Pharmaceutical
Advocate; providing authority for the secretary of each
department to cooperate with the Office of the Pharmaceutical
Advocate in the purchase of prescription drugs; and
eliminating requirement that the Governor focus resources on
creation of a prescription drug program from the state Lottery
Act.

Be it enacted by the Legislature of West Virginia:That §5-16-7b of the Code of West Virginia, 1931, as amended;
be repealed; that §5-16C-1, §5-16C-2, §5-16C-3, §5-16C-4, §5-16C-5,
§5-16C-6, §5-16C-7, §5-16C-8, §5-16C-9 and §5-16C-10 of said code
be repealed; that §5A-3-1a of said code be repealed; that §5A-3C-1,
§5A-3C-2, §5A-3C-3, §5A-3C-4, §5A-3C-5, §5A-3C-6, §5A-3C-7, §5A-3C-8, §5A-3C-9, §5A-3C-10, §5A-3C-11, §5A-3C-12, §5A-3C-13,
§5A-3C-14, §5A-3C-15, §5A-3C-16 and §5A-3C-17 of said code be
repealed; that said code be amended by adding thereto a new
article, designated §5-16D-1, §5-16D-2, §5-16D-3, §5-16D-4,
§5-16D-5, §5-16D-6, §5-16D-7, §5-16D-8, §5-16D-9, §5-16D-10,
§5-16D-11, §5-16D-12, §5-16D-13, §5-16D-14, §5-16D-15, §5-16D-16,
§5-16D-17, §5-16D-18, §5-16D-19, §5-16D-20, §5-16D-21, §5-16D-22,
§5-16D-23, §5-16D-24, §5-16D-25, §5-16D-26, §5-16D-27, §5-16D-28,
§5-16D-29 and §5-16D-30; that §5F-2-2 of said code be amended and
reenacted; and that §29-22-18a of said code be amended and
reenacted, all to read as follows:

CHAPTER 5. GENERAL POWERS AND AUTHORITY OF THE GOVERNOR,

SECRETARY OF STATE AND ATTORNEY GENERAL; BOARD

OF PUBLIC WORKS; MISCELLANEOUS AGENCIES, COMMISSIONS,

OFFICES, PROGRAMS, ETC.

ARTICLE 16D. WEST VIRGINIA PHARMACEUTICAL ADVOCATE ACT.
§5-16D-1. Title.
The provisions of this article shall be known as and referred
to as the "West Virginia Pharmaceutical Advocate Act."§5-16D-2. Legislative findings and intent.
(a) The Legislature finds:
(1) That the rising cost of prescription drugs is one of the
most critical issues facing the current health care system in the
State of West Virginia;
(2) This crisis has imposed a significant hardship on
individuals who have limited budgets, are uninsured or who have prescription coverage that is unable to control costs successfully
due to cost shifting and disparate pricing policies;
(3) That the average cost per prescription for seniors rose
significantly between one thousand nine hundred ninety-two and two
thousand, and is expected to continue increasing significantly
through two thousand ten;
(4) State government agencies could achieve significant
savings through the coordinated purchase of prescription drugs;
(5) That there is an increasing need for citizens of West
Virginia to have affordable access to prescription drugs; and
(6) That the Legislature does not intend the imposition of the
programs under this article to penalize or otherwise jeopardize the
benefits of veterans and other recipients of federal supply
schedule drug prices.
(b) In an effort to promote healthy communities and to protect
the public health and welfare of West Virginia residents, the
Legislature finds that it is its responsibility to make every
effort to provide affordable prescription drugs for all residents
of West Virginia.
§5-16D-3. Definitions.
In this article:
(1) "Advertising or marketing" means any manner of
communication of information, either directly or indirectly, that
is paid for and usually persuasive in nature about products,
services or ideas related to pharmaceuticals by identified sponsors
through various media, persons or other forms as further defined by legislative rule.
(2) "Audit" means a systematic examination and collection of
sufficient, competent evidential matter needed for an auditor to
attest to the fairness of management's assertions in the financial
statements and to evaluate whether management has sufficiently and
effectively carried out its responsibilities and complied with
applicable laws and regulations, conducted by an independent
certified public accountant in accordance with the applicable
statement on standards.
(3) "Average wholesale price" means the amount determined from
the latest publication of the Blue Book, a universally subscribed
pharmacist reference guide annually published by the Hearst
Corporation. "Average wholesale prices" may also be derived
electronically from the drug pricing database synonymous with the
latest publication of the Blue Book and furnished in the National
Drug Data File by First Data Bank, a service of the Hearst
Corporation.
(4) "Brand name drug" means an innovator drug as defined in
this section.(5) "Dispensing fee" means the fee charged by a pharmacy to
dispense pharmaceuticals.
(6) "Drug manufacturer" or "pharmaceutical manufacturer" means
any entity which is engaged in:
(A) The production, preparation, propagation, compounding,
conversion or processing of prescription drug products, either
directly or indirectly by extraction from substances of natural origin, or independently by means of chemical synthesis or by a
combination of extraction and chemical synthesis; or
(B) In the packaging, repackaging, labeling, relabeling or
distribution of prescription drug products. "Drug manufacturer" or
"pharmaceutical manufacturer" does not include a wholesale
distributor of drugs or a retail pharmacy licensed under state law.
(7) "Federal supply schedule" means the price available to all
federal agencies for the purchase of pharmaceuticals authorized in
the Veterans Health Care Act of 1992, PL 102-585. Federal supply
schedule prices are intended to equal or better the prices
manufacturers charge their "most-favored" nonfederal customers
under comparable terms and conditions.
(8) "Labeler" means an entity or person that receives
prescription drugs from a manufacturer or wholesaler and repackages
those drugs for later retail sale and that has a labeler code from
the Food and Drug Administration pursuant to 21 C.F.R. §207.20
(1999).
(9) "Multiple-source drug", "innovator drug" and "noninnovator
drug" mean the following:
(A) The term "multiple-source drug" means, when two or more
drug products are: Rated as therapeutically equivalent (under the
Food and Drug Administration's most recent publication of "Approved
Drug Products with Therapeutic Equivalence Evaluations"), except as
provided in paragraph (B) of this subdivision, are pharmaceutically
equivalent and bioequivalent, as determined by the Food and Drug
Administration, and the term "innovator drug" is referred to in this article as "brand". The term "innovator drug" means a drug
which is produced or distributed under an original new drug
application approved by the Food and Drug Administration, including
a drug product marketed by any cross-licensed producers or
distributors operating under the new drug application and any
multiple-source drug that was originally marketed under an original
new drug application approved by the Food and Drug Administration.
The term "noninnovator drug" is referred to in this article as
"generic." The term "noninnovator drug" means a multiple-source
drug that is not an "innovator drug."
(B) Paragraph (A) of this subdivision does not apply if the
Food and Drug Administration changes by regulation the requirement
that, for purposes of the publication described in paragraph (A) of
this subdivision, in order for drug products to be rated as
therapeutically equivalent, they must be pharmaceutically
equivalent and bioequivalent.
(10) "Office of the Pharmaceutical Advocate" or "Office" means
the Office created pursuant to section four of this article.
(11) "Person" means any natural person or persons or any
corporation, partnership, company, trust or association of persons.
(12) "Pharmaceutical Advocate" or "Advocate" means the
position created pursuant to section five of this article.
(13) "Pharmacy benefit manager" means an entity that procures
prescription drugs at a negotiated rate under a contract and which
may serve as a third party prescription drug benefit administrator.
(14) "Pharmaceutical drug detailing" or "detailing" means the function performed by a sales representative who is employed by a
pharmaceutical manufacturer for the purpose of; promotion of
pharmaceutical drugs or related products; education about
pharmaceutical drugs or related products; or to provide samples of
pharmaceutical drugs, related products or related materials, gifts,
food or meals.
(15) "Prescription drug purchasing agreement" means a written
agreement to pool all parties' prescription drug buying power in
order to negotiate the best possible prices and which delegates
authority to negotiate on behalf of the parties to the Advocate.
(16) "Prescription drugs" mean substances recognized as drugs
in the official "United States Pharmacopoeia, official Homeopathic
Pharmacopoeia of the United States or National Formulary," or any
supplement thereto, dispensed pursuant to a prescription issued by
an authorized health care practitioner, for use in the diagnosis,
cure, mitigation, treatment or prevention of disease in a human, as
well as prescription drug delivery systems, testing kits and
related supplies.
(17) "Savings" means the difference between the previous price
of a prescription drug including any discounts, rebates or price
containments and the current price after the effective date of this
article for the Public Employees Insurance Agency, the Children's
Health Insurance Program, the Division of Corrections, the Division
of Juvenile Services, the Regional Jail and Correctional Facility
Authority, the Workers' Compensation Fund, state colleges and
universities, public hospitals, state or local institutions such as nursing homes, veterans' homes, the Division of Rehabilitation,
public health departments and the Bureau of Medical Services or
other programs which are payors for prescription drugs.
(18) "Sole source" means a pharmaceutical that provides a
unique and powerful advantage available in the market to a broad
group of patients established under federal law.
(19) "West Virginia Pharmaceutical Advocate Advisory Council"
or "Council" means the Council created pursuant to section eleven
of this article.

§5-16D-4. Creation of Office of Pharmaceutical Advocate;
cooperation among state agencies; Medicaid and CHIP
program.

(a) There is hereby created the Office of Pharmaceutical
Advocate. The purpose of this Office is to obtain favorable
pharmaceutical prices for state agencies and other qualified
entities pursuant to this article. The Office is under the direct
supervision of the Pharmaceutical Advocate, who is responsible for
the exercise of the duties and powers assigned to the Office under
the provisions of this article.
(b) The Public Employees Insurance Agency, the Children's
Health Insurance Program, the Division of Corrections, the Division
of Juvenile Services, the Regional Jail and Correctional Facility
Authority, the Workers' Compensation Fund, state colleges and
universities, public hospitals, state or local institutions such as
nursing homes, veterans' homes, the Division of Rehabilitation,
public health departments and the Bureau of Medical Services or other programs which are payors for prescription drugs shall
cooperate with the Office of the Pharmaceutical Advocate to meet
the requirements of this article.
(c) The Medicaid program and the West Virginia Children's
Health Insurance program may be exempt from participation in this
program until approval by the Center for Medicare and Medicaid
Services has been granted if it is determined to be required by the
Pharmaceutical Advocate created under section five of this article.§5-16D-5. West Virginia Pharmaceutical Advocate; appointment;
qualifications; oath; salary.
(a) The Office of the Pharmaceutical Advocate is under the
supervision of the Pharmaceutical Advocate. The Advocate is the
executive and administrative head of the office and shall be
appointed by the Governor with advice and consent of the Senate.
The Advocate shall be qualified by training and experience to
direct the operations of the Office of the Pharmaceutical Advocate,
and serves at the will and pleasure of the Governor. The duties of
the Advocate include, but are not limited to, the management and
administration of the Office of the Pharmaceutical Advocate.
(b) Notwithstanding any provision of this code to the
contrary, the Advocate is the sole source for management and
negotiation and purchase of all pharmaceuticals for all state
agencies and other qualified entities including, but not limited
to, the Public Employees Insurance Agency, the Children's Health
Insurance Program, the Division of Corrections, the Division of
Juvenile Services, the Regional Jail and Correctional Facility Authority, the Workers' Compensation Fund, state colleges and
universities, public hospitals, state or local institutions such as
nursing homes, veterans' homes, the Division of Rehabilitation,
public health departments and the Bureau of Medical Services or
other programs which are payors for prescription drugs.
(c) The Advocate:
(1) Serves on a full-time basis and may not be engaged in any
other profession or occupation;
(2) May not hold political office in the government of the
state either by election or appointment while serving as the
Advocate;
(3) Shall be a citizen of the United States and become a
resident of the state within ninety days of appointment;
(4) Is entitled to receive an annual salary as provided by the
Governor; and
(5) Is ineligible for civil service coverage as provided in
section four, article six, chapter twenty-nine of this code. Any
executive secretary hired by the Advocate is ineligible for civil
service coverage.
(d) Before entering upon the discharge of the duties as
Advocate, the Advocate shall take and subscribe to the oath of
office prescribed in section five, article IV of the Constitution
of West Virginia. The executed oath shall be filed in the office
of the Secretary of State.
(e) The Advocate shall report directly to the Governor or the
Governor's designee.§5-16D-6. West Virginia Pharmaceutical Advocate; powers and
duties, hiring of staff.(a) The Advocate serves as the Chairman of the Pharmaceutical
Advocate Advisory Council established pursuant to section eleven of
this article.
(b) The Advocate has the power and authority to:
(1) Purchase or enter into contracts or agreements as
necessary to achieve the purposes of this article and pursuant to
the provisions of section seven of this article;
(2) File suit;
(3) Evaluate and renegotiate existing contracts for state
purchase of prescription drugs for cost savings;
(4) Negotiate and execute pharmacy benefit management
contracts using the federal supply schedule as a benchmark for the
purpose of managing rising drug costs for this state and all
parties which have executed prescription drug purchasing agreements
with the Office of Pharmaceutical Advocate or other state agency;
(5) Provide discount prices or rebate programs as prudent for
seniors and persons without adequate prescription drug insurance;
(6) Work to achieve disclosure of the amount spent by
prescription drug manufacturers with regard to expenditures for
advertising, marketing, and promotion, as well as for provider
incentives and research and development efforts;
(7) Establish programs aimed at educating health care
practitioners authorized to prescribe prescription drugs about the
relative costs and benefits of various prescription drugs, with an emphasis on generic substitution for brand name drugs when
available and appropriate; prescribing established, less-costly
drugs instead of newer and more expensive drugs, when appropriate;
and prescribing lower dosages of prescription drugs when
appropriate;
(8) Establish disease management programs aimed at enhancing
the effectiveness of treating certain diseases identified as
prevalent among this state's population with prescription drugs;
(9) Facilitate the establishment of voluntary private buying
clubs, cooperatives or purchasing alliances comprised of small
businesses or individuals for the purpose of purchasing
prescription drugs at optimal prices;
(10) Develop and implement a program to maximize savings to
the state and its citizens from Section 340B of the Federal Public
Health Service Act, 42 U.S.C. 256b, as applicable;
(11)Develop and implement a program under which the state
purchases, then resells, prescription drugs at cost, plus operating
expenses, to West Virginia consumers;
(12)Develop and implement a program under which the state may
become a licensed pharmaceutical wholesaler for the purposes of
making pharmaceuticals obtained by a buying consortium available to
local pharmacies; and
(13)Develop and implement other programs, projects and
initiatives to achieve the purposes of this article, including
initiating, evaluating, and promoting other strategies that result
in reduced costs of prescription drugs for the citizens of West Virginia, including, but not limited to:
(A) A common preferred drug list for the Public Employees
Insurance Agency, the Children's Health Insurance Program, the
Division of Corrections, the Division of Juvenile Services, the
Regional Jail and Correctional Facility Authority, the Workers'
Compensation Fund, state colleges and universities, public
hospitals, state or local institutions such as nursing homes,
veterans' homes, the Division of Rehabilitation, public health
departments and the Bureau of Medical Services or other programs
which are payors for prescription drugs;
(B) A streamlined prior authorization process for state
insurers; and
(C) Patient assistance programs in their current forms, as
well as new programs, such as central fill pharmacy/bulk
replenishment models.
(c) The Advocate shall consult with the Council and employ
such professional, clerical, technical and administrative personnel
as may be necessary to carry out the provisions of this article.
(d) The Advocate, with input and advice from the Council,
shall prepare and submit annual proposed appropriations for the
Office of the Pharmaceutical Advocate and the Council to the
Governor.
(e) Submit an annual report to the Governor and the
Legislature on the condition, operation and functioning of the
Office of the Pharmaceutical Advocate.
(f) Supervise the fiscal management and responsibilities of the Office of the Pharmaceutical Advocate.
(g) Keep an accurate and complete record of all Office of the
Pharmaceutical Advocate proceedings, record and file all bonds and
contracts and assume responsibility for the custody and
preservation of all papers and records of the Office.§5-16D-7. Authorization to execute prescription drug purchasing
agreements.(a) The Advocate may execute, subject to the provisions of
subsection (c) of section six of this article and as permitted by
applicable federal law, prescription drug purchasing agreements
with:
(1) All departments, agencies, authorities, institutions,
programs, quasi-public corporations and political subdivisions of
this state, including, but not limited to, the Public Employee's
Insurance Agency, the Children's Health Insurance Program, the
Division of Corrections, the Division of Juvenile Services, the
Regional Jail and Correctional Facility Authority, the Workers'
Compensation Fund, state colleges and universities, public
hospitals, state or local institutions such as nursing homes,
veterans' homes, the Division of Rehabilitation, public health
departments and the Bureau of Medical Services: Provided, That any
contract or agreement executed with or on behalf of the Bureau of
Medical Services shall contain all necessary provisions to comply
with the provisions of Title XIX of the Social Security Act, 42
U.S.C. §1396 et seq., dealing with pharmacy services offered to
recipients under the medical assistance plan of West Virginia;(2) Governments of other states and jurisdictions and their
individual departments, agencies, authorities, institutions,
programs, quasi-public corporations and political subdivisions;
(3) Regional or multistate purchasing alliances or consortia,
formed for the purpose of pooling the combined purchasing power of
the individual members in order to increase bargaining power; and
(4) Arrangements with entities in the private sector,
including, commercial insurance carriers, self-funded benefit
plans and private and not-for-profit hospitals toward combined
purchasing of health care services, health care management
services, pharmacy benefits management services or pharmaceutical
products: Provided, That no private entity may be compelled to
participate in the prescription drug purchasing pool.
(b) The Council created pursuant to section eleven of this
article is responsible for reviewing any proposed contract
authorized by this article before it is executed by the Advocate.
If the Council determines that the proposed contract meets the
requirements of this article and would assist in effectively
managing the costs for the programs involved and would not result
in jeopardizing state funds or funds due the state, it shall
approve the contract and authorize the Advocate to execute the
contract.
(c) The Council may not approve and the Advocate may not
execute any agreement that does not effectively and efficiently
manage rising drug costs on behalf of the parties to the agreement.
(d) The Council may not approve and the Advocate may not execute any agreement that grants the state's credit for the
purchase of prescription drugs by any entity other than this state.
§5-16D-8. Audit required; reports.
(a) The Advocate shall cause to be conducted an audit of any
funds expended pursuant to any prescription drug purchasing
agreement or pharmacy benefit management contract executed under
the provisions of this article for each fiscal year that the
prescription drug purchasing agreement or pharmacy benefit
management contract is in effect. The Advocate shall submit the
audit to the Joint Committee on Government and Finance upon
completion, but in no event later than the thirty-first day of
December after the end of the fiscal year subject to the audit.
(b) The Advocate shall provide written notice to the Joint
Committee on Government and Finance before executing a prescription
drug purchasing agreement or a pharmacy benefit management contract
or amending an existing prescription drug contract.
§5-16D-9. Authorization to execute pharmacy benefit management
contract.
The Advocate may negotiate and execute pharmacy benefit
management contracts for the purpose of managing rising drug costs
for this state and all parties which have executed prescription
drug purchasing agreements with the state or any state agency,
including, but not limited to, the Public Employees Insurance
Agency, the Children's Health Insurance Program, the Division of
Corrections, the Division of Juvenile Services, the Regional Jail
and Correctional Facility Authority, the Workers' Compensation Fund, state colleges and universities, public hospitals, state or
local institutions such as nursing homes, veterans' homes, the
Division of Rehabilitation, public health departments and the
Bureau of Medical Services or other programs which are payors for
prescription drugs.
§5-16D-10. Authorization to amend existing contracts.
The Advocate may renegotiate and amend existing prescription
drug contracts to which the state or any state agency, including,
but not limited to, the Public Employees Insurance Agency, the
Children's Health Insurance Program, the Division of Corrections,
the Division of Juvenile Services, the Regional Jail and
Correctional Facility Authority, the Workers' Compensation Fund,
state colleges and universities, public hospitals, state or local
institutions such as nursing homes, veterans' homes, the Division
of Rehabilitation, public health departments and the Bureau of
Medical Services, or other programs which are payors for
prescription drugs is a party for the purpose of managing rising
drug costs.§5-16D-11. Exemption from Purchasing Division requirements.
The provisions of article three, chapter five-a of
this code do not apply to the agreements and contracts executed
under the provisions of this article, except that the contracts and
agreements shall be approved as to form and conformity with
applicable law by the Attorney General. §5-16D-12. Creation of the
West Virginia Pharmaceutical Advocate Advisory Council. (a) The West Virginia Pharmaceutical Advocate Advisory Council is hereby created. The Council is an independent, self-sustaining
council that has the powers and duties specified in this article.
(b) The Council is a part-time council whose members perform
such duties as specified in this article. The ministerial duties
of the Council shall be administered and carried out by the Office
of the Pharmaceutical Advocate.
(c) Each member of the Council shall devote the time necessary
to carry out the duties and obligations of the office. Those
members appointed by the Governor may pursue and engage in another
business or occupation or gainful employment that is not in
conflict with the duties of the Council.
(d) The Council is self-sustaining and independent, however,
it, its members, the Advocate and employees of the Office of the
Pharmaceutical Council are subject to article nine-a of chapter
six, chapter six-b, chapter twenty-nine-a and chapter twenty-nine-b
of this code.

§5-16D-13. Appointment of members of the West Virginia
Pharmaceutical Advocate Advisory Council; chairman;
qualifications and eligibility; reimbursement for
expenses.

(a) The Council is comprised of the Pharmaceutical Advocate,
the Secretary of the Department of Administration or his or her
designee, the Director of the Public Employees Insurance Agency or
his or her designee, the Commissioner of the Bureau of Medical
Services of the Department of Health and Human Resources or his or
her designee, the Secretary of the Department of Health and Human Resources or his or her designee, the Commissioner of the Bureau of
Senior Services or his or her designee, the Secretary of the
Department of Military Affairs and Public Safety or his or her
designee, the Secretary of the Department of Education and the Arts
or his or her designee, and five members from the public who shall
be appointed by the Governor with the advice and consent of the
Senate. One public member shall be a licensed pharmacist employed
by a community retail pharmacy, one public member shall be a
representative of a pharmaceutical manufacturer with substantial
operations located in West Virginia that has at least seven hundred
fifty employees, one public member shall be a primary care
physician, one public member shall represent those who will receive
benefit from the establishment of the Office of the Pharmaceutical
Advocate and one public member shall have experience in the
financing, development or management of a health insurance company
which provides pharmaceutical coverage. Each public member shall
serve for a term of four years. Of the public members of the
Council first appointed, one shall be appointed for a term ending
the thirtieth day of June, two thousand six, and two each for terms
of three and four years. Each public member serves until his or
her successor is appointed and has qualified. A member of the
Council may be removed by the Governor for cause.
(b) The Pharmaceutical Advocate serves as Chairperson of the
Council.
(c) Council members may not be compensated in their capacity
as members but shall be reimbursed for reasonable expenses incurred in the performance of their duties.§5-16D-14. Meeting requirements.
(a) The Council shall meet within the state at least once per
calendar quarter or at such times as the Chairman may decide. The
Council shall also meet upon a call of five or more members upon
seventy-two hours written notice to each member.
(b) Seven members of the Council are a quorum for the
transaction of any business and for the performance of any duty.
(c) A majority vote of the members present is required for any
final determination by the Council. Voting by proxy is not
allowed.
(d) The Council shall keep a complete and accurate record of
all its meetings according to section five, article nine-a, chapter
six of this code.§5-16D-15. Removal of Council members.Notwithstanding the provisions of section four, article six,
chapter six of this code, the Governor may remove any Council
member for incompetence, misconduct, gross immorality, misfeasance,
malfeasance or nonfeasance in office.§5-16D-16. General duties of the West Virginia Pharmaceutical
Advocate Advisory Council.
The Council has general responsibility to review and provide
advice and comment to the Office of the Pharmaceutical Advocate on
its policies and procedures relating to the purchase of
prescription drugs. The Council shall offer advice to the Office
of the Pharmaceutical Advocate on matters over which the office has authority and oversight. This includes, but is not limited to:
(1) Hiring of professional, clerical, technical and
administrative personnel as may be necessary to carry out the
provisions of this article;
(2) Promulgation of rules, including emergency rules, that are
necessary to carry out the provisions of this article;
(3) Contracts or agreements; and
(4) Development of policy necessary to meet the duties and
responsibilities of the Office or the Advocate pursuant to the
provisions of this article.

(a) The Advocate is authorized to investigate the feasibility
of purchasing prescription drugs from sources in Canada, which may
include the feasibility of the state or an instrumentality thereof
serving as a wholesale distributor of prescription drugs in the
state.
(b) Upon a determination by the Advocate that the same is
feasible and in the best interests of the citizens of the state,
the Advocate is authorized to pursue waivers from the federal
government, including, but not limited to, from the United States
Food and Drug Administration, as necessary for the state to
accomplish prescription drug purchasing from sources in Canada:
Provided, That if a waiver is not granted, the Advocate is
authorized to take necessary legal action.
(c) Upon a favorable finding by the appropriate federal agencies or courts, notwithstanding any provision of this code to
the contrary, the Advocate may establish and implement a
methodology to provide wholesale drugs to licensed pharmacies
located within West Virginia.§5-16D-18. Multistate discussion group; agreements.
The Advocate, for the purposes of administering, reviewing or
amending the duties and responsibilities granted him or her by this
article, shall continue to investigate the feasibility of
mulitstate discussions and may enter into multistate discussions
and agreements when to do so would enure to the financial benefit
of all West Virginians who are consumers of pharmaceuticals.
5-16D-19. Creation of Clearinghouse Program.
(a) There is hereby created within the Office of the
Pharmaceutical Advocate the State Prescription Drug Assistance
Clearinghouse Program. The brand pharmaceutical manufacturers
shall create and implement a program in consultation with the
Office of the Pharmaceutical Advocate to assist state residents who
are low income or uninsured to gain access to prescription
medications through existing private and public sector programs and
prescription drug assistance programs offered by manufacturers,
including discount and coverage programs. The brand pharmaceutical
manufacturers shall:
(1) Use available computer software programs that access an
eligible individual with the appropriate private or public programs
relating to the individual's medically necessary drugs;
(2) Provide education to individuals and providers to promote the program and to expand enrollment and access to necessary
medications for low-income or uninsured individuals qualifying for
the Programs; and
(3) Be responsible for the cost of the establishment of the
Program, and be responsible for running the Program, regardless of
the date of transfer of the Program to the state, for the period
until a date no earlier than the thirtieth day of June, two
thousand five, and ownership of the technology, website and other
program features shall be transferred to the state on the same
date.
The Office of the Pharmaceutical Advocate shall provide
oversight with respect to the establishment, construction, and
continued operation of the Program and Program features.
(b) The participating brand pharmaceutical manufacturers shall
contribute the funding for the promotion of the public relations
program attendant to the establishment of the Program. The
participating brand pharmaceutical manufacturers shall be
responsible for the cost of the establishment of the program and
the cost of the ongoing program, regardless of the date of transfer
of ownership of the program to the state, for the period until a
date not earlier than the thirtieth day of June, two thousand
five.

There is hereby established within the Office of the Pharmaceutical Advocate a Discount Drug Program to provide
low-income, uninsured individuals with access to prescription drugs
from participating brand pharmaceutical companies and pharmacists
through either a state-sponsored discount card program or a program
that extends current brand pharmaceutical manufacturer prescription
drug assistance programs:
(a) The state hereby establishes a state-sponsored
prescription drug discount card program for certain eligible
residents of West Virginia:
(1) Eligible individuals include uninsured residents of West
Virginia up to two hundred per cent of the federal poverty
guideline who have not been covered by a prescription drug program,
whether public or private, at least six months prior to applying to
the discount card program;
(2) The state may negotiate voluntary discounts with brand
pharmaceutical manufacturers and pharmacists: Provided, That the
total discount received from the manufacturer shall pass through to
the eligible resident;
(3) Failure of a brand pharmaceutical manufacturer to
participate in the voluntary discount card program will not result
in prior authorization on drugs in the medicaid program which would
not otherwise be subject to prior authorization but for the failure
of the manufacturer to participate in this program; and
(4) The state shall not establish a formulary or preferred
drug list as part of the discount card program.
(b) The brand pharmaceutical manufacturers may extend existing prescription drug assistance programs to eligible residents of West
Virginia. Eligible individuals include uninsured residents of West
Virginia up to two hundred percent of the federal poverty level who
have not been covered by a prescription drug program, whether
public or private, at least six months prior to applying to the program.
(c) The program established under this section shall be
structured so that a member presenting a discount card at a
participating pharmacy will receive the full benefit of the
pharmacy discount, as well as the manufacturer's discount, at a
point of sale transaction. The program, or the pharmacy benefit
manager contracted by the program, shall coordinate the drug
discount information provided by participating pharmacies and
manufacturers so that the available drug discounts are provided to
the member at the point of sale.
(d) Manufacturers participating in the voluntary program
established under this section shall cooperate with the Program,
the Office of the Pharmaceutical Advocate or the pharmacy benefit
manager contracted by either the program or the Office of the
Pharmaceutical Advocate, to provide the current list of drugs and
the percentage of discount from the average wholesale price for
such drugs, or the rebates that the manufacturer will provide under
the program. It is the intent of this program that adequate drug
price and discount or rebate information be provided by the
manufacturer, such that the program and participating pharmacies
will have available such drug prices and discounts or rebates at a
point of sale pharmaceutical drug transaction. Retail pharmacies will be responsible for no more than fifty percent of the discount
offered by the manufacturer to the participant.
(1) Pharmacies participating in the voluntary program or
programs established under this section are responsible for no more
than fifty percent of the discount offered by the manufacturer to
the participant, and shall be paid a dispensing fee of no more than
three dollars and fifty cents per prescription with regard to
prescriptions filled under the program or programs.
(2) Upon the presentation of a valid discount card, payment
for the prescription and otherwise meeting appropriate criteria to
have their prescription filled, the cardholder shall have their
prescription filled by a participating pharmacy. To accomplish the
transaction, the participating pharmacy shall electronically
transmit the transaction to the program, Office of the
Pharmaceutical Advocate or pharmacy benefit manager contracted by
the program for processing. The Office of the Pharmaceutical
Advocate, or the program's pharmacy benefit manager, shall
determine the discounted cost of the drug, including the discount
provided, the discount provided by the pharmacy, the discount or
rebate provided by the manufacturer, the pharmacy dispensing fee,
and any pharmacy benefit manager transaction fee. The program,
Office of the Pharmaceutical Advocate, or the program's pharmacy
benefit manager, shall then transmit to the manufacturer an
electronic statement of the amount the manufacturer owes on the
transaction to cover the manufacturer's discount or rebate and the
program's pharmacy benefit manager's processing fee. The manufacturer shall, in turn, at least every fourteen days, transmit
such monetary amounts for the transaction to the program or the
program's pharmacy benefit manager, and the program or the
program's pharmacy benefit manager, shall pass such discount or
rebate amounts back to the participating pharmacy which originated
the transaction immediately.
(e) The pharmaceutical manufacturers shall report to the Joint
Committee on Government and Finance on a monthly basis all
activities related to the implementation of this program including
the number of citizens serviced and the services provided, as well
as, the benefits, the costs and the discounts obtained.§5-16D-21. Authorization to take advantage of Acts of Congress,
accept gifts, grants and matching funds.
The Office of the Pharmaceutical Advocate is authorized to
take full advantage of the benefits and provisions of any Acts of
Congress and to accept any and all gifts, grants and matching funds
whether in the form of money or services.§5-16D-22. Agency's management ability continued.Nothing contained in this article limits the ability of the
various state agencies to enter into contracts or arrangements or
to otherwise manage their pharmacy programs until such time as the
programs created or authorized pursuant to this article are
implemented.
§5-16D-23. Restraint of trade; civil and criminal violations
defined.(a) The following are considered to restrain trade or commerce unreasonably and are unlawful:
(1) A contract, combination or conspiracy between two or more
persons:
(A) For the purpose or with the intent to fix, control or
maintain the market price, rate or fee of pharmaceuticals; or
(B) Allocate or divide customers or markets, functional or
geographic, for any pharmaceutical; and
(2) The establishment, maintenance or use of a monopoly or an
attempt to establish a monopoly of trade or commerce, any part of
which is within this state, by any persons for the purpose of or
with the intent to exclude competition or control, fix or maintain
pharmaceutical prices.
(b) Any person violating the provisions of this section is
guilty of a felony and, upon conviction thereof, shall be confined
in a state correctional facility for not less than one nor more
than ten years, or fined in an amount consistent with the Clayton
Act 15 U.S.C. §15 et seq., which may include treble damages, or
both fined and confined.
(c) Any person violating the provisions of this section is
liable for a civil penalty and fine in an amount consistent with
the Clayton Act 15 U.S.C. §15 et seq., which may include treble
damages, for each violation.
(d) The county prosecuting attorney shall investigate
suspected violations of, and institute criminal proceedings
pursuant to, the provisions of this section.
(e) The Attorney General or special counsel appointed by the Governor, in his or her discretion, shall represent the state in
all civil proceedings brought on behalf of the state to enforce the
provisions of this section. After payment of all attorney fees and
costs, no less than fifty percent of all judgments or settlements
shall be placed in the General Revenue Fund of the state.§5-16D-24. Advertising costs; reporting of same.(a) Advertising costs for prescription drugs, based on
aggregate national data, shall be reported to the Pharmaceutical
Advocate by all manufacturers and labelers of prescription drugs
dispensed in this state that employs, directs or utilizes marketing
representatives. The reporting shall assist this state in its role
as a purchaser of prescription drugs and an administrator of
prescription drug programs, enabling this state to determine the
scope of prescription drug advertising costs and their effect on
the cost, utilization and delivery of health care services and
furthering the role of this state as guardian of the public interest.
(b) The Advocate shall establish, by legislative rule, the
reporting requirements of information by labelers and manufacturers
which shall include all national aggregate expenses associated with
advertising and direct promotion of prescription drugs through
radio, television, magazines, newspapers, direct mail and telephone
communications as they pertain to residents of this state.
(c) The following are exempt from disclosure requirements:
(1) All free samples of prescription drugs intended to be
distributed to patients;
(2) All payments of reasonable compensation and reimbursement of expenses in connection with a bona fide clinical trial. As used
in this subdivision, "clinical trial" means an approved clinical
trial conducted in connection with a research study designed to
answer specific questions about vaccines, new therapies or new ways
of using known treatments; and
(3) All scholarship or other support for medical students,
residents and fellows to attend significant educational, scientific
or policy-making conference of national, regional or specialty
medical or other professional association if the recipient of the
scholarship or other support is selected by the association.
(d) The Advocate is authorized to establish time lines, the
documentation, form and manner of reporting required as he or she
determines necessary to effectuate the purpose of this article.
The Advocate shall include in the annual report required pursuant
to subsection (e) of section five of this article, in an aggregate
form, the information provided in the required reporting.
(e) Notwithstanding any provision of law to the contrary,
information submitted to the Advocate pursuant to this section is
confidential and is not a public record and is not available for
release pursuant to the West Virginia Freedom of Information Act.
Data compiled in aggregate form by the Advocate for the purposes of
reporting required by this section is a public record as defined in
the West Virginia Freedom of Information Act, as long as it does
not reveal trade information that is protected by state or federal
law.

§5-16D-25. State role; authority for participation by all state agencies.

(a) For purpose of implementing this article, the state is
represented by the Pharmaceutical Advocate and he or she has
authority to negotiate pharmaceutical prices to be paid by program
participants. These negotiated prices shall be available to all programs.
(b) The Public Employees Insurance Agency, the Children's
Health Insurance Program, the Division of Corrections, the Division
of Juvenile Services, the Regional Jail and Correctional Facility
Authority, the Workers' Compensation Fund, state colleges and
universities, public hospitals, state or local institutions such as
nursing homes, veterans' homes, the Division of Rehabilitation,
public health departments and the Bureau of Medical Services or
other programs which are payors for prescription drugs shall have
the authority to participate in any program developed by the Office
of the Pharmaceutical Advocate, including but not limited to, a
uniform preferred drug list.

(a) The Advocate, for the purposes of administering, reviewing
or amending the duties and responsibilities granted him or her by
this article, shall investigate the feasibility of including
private individuals, commercial insurance carriers, self-insured
companies and private and not-for-profit hospitals in a negotiated
drug pricing program.
(b) The Advocate has the power to establish programs and procedure necessary to allow private individuals, commercial
insurance carriers, self-insured companies and private and
not-for-profit hospitals to participate in the negotiated drug
pricing program. This power includes, but is not limited to, the
power to:
(1) Negotiate and execute contracts or cooperative agreements
necessary to permit private individuals, commercial insurance
carriers, self-insured companies and private and not-for-profit
hospitals to participate in the negotiated drug pricing program;
and
(2) Promulgate legislative rules necessary to facilitate the
participation of private individuals, commercial insurance
carriers, self-insured companies and private and not-for-profit
hospitals in the negotiated drug pricing program.§5-16D-27. Rule Making.
To implement any section of this article the Office of the
Pharmaceutical Advocate, in consultation with the Council, shall
propose rules for legislative approval in accordance with chapter
twenty-nine-a of this code. This authority shall include emergency
rule-making authority pursuant to the provisions of section
fifteen, article three, chapter twenty-nine-a of this code. These
rules shall include, but are not limited to:
(1) Development of criteria to establish a purchasing
consortium. These criteria should include, but are not limited to,
membership eligibility; which shall include state entities that are
payors for prescription drugs and may include private individuals and commercial insurance carriers, self-funded benefit plans and
private and not-for-profit hospitals; consortium operation and
functionality and the manner and procedure for the consortium to
either bid or negotiate pricing with pharmaceutical manufacturers
using the federal supply schedule as a benchmark for obtaining
lower priced pharmaceuticals;
(2) The requirements for implementation of the pharmaceutical
discount program pursuant to section twenty of this article
including, but not limited to, eligibility determination, program
operation and review, pharmacy and manufacture participation and
other elements necessary for the program to function;
(3) Development of a uniform preferred drug list for use by
state entities who are payors for prescription drugs. These
entities include, but are not limited to, the Public Employees
Insurance Agency, the Children's Health Insurance Program, the
Division of Corrections, the Division of Juvenile Services, the
Regional Jail and Correctional Facility Authority, the Workers'
Compensation Fund, state colleges and universities, public
hospitals, state or local institutions such as nursing homes,
veterans' homes, the Division of Rehabilitation, public health
departments and the Bureau of Medical Services, or other programs
which are payors for prescription drugs;
(4) The reporting requirements of information by labelers and
manufacturers required pursuant to section twenty-four of this
articlewhich shall include all national aggregate expenses
associated with advertising and direct promotion of prescription drugs through radio, television, magazines, newspapers, direct mail
and telephone communications as they pertain to residents of this
state;
(5) Development of virtual wholesale program to allow the
state to act as a pharmaceutical drug wholesaler and ensure that
prices obtained by a buying consortium operated by the
Pharmaceutical Advocate would be made available for purchase by
local pharmacies;
(6) Procedural requirements of execution of pharmacy benefit
management contracts pursuant to section nine of this article and
prescription drug purchasing agreements pursuant to section seven
of this article;and
(7) Other rules considerd necessary by the Pharmaceutical
Advocate to carry out the duties and responsibilities prescribed to
the Advocate or the Office of the Pharmaceutical Advocate in this
article.§5-16D-28. Potential use of savings.
Savings identified by all program participants shall be
quantified and certified to the Pharmaceutical Advocate and
included in the annual report of the Pharmaceutical Advocate to
the Governor and the Legislature provided in subsection (e) of
section six of this article. Savings, or any part thereof, created
by the implementation of this program may, in the sole discretion
of the Legislature, be directed towards the maintenance of existing
state health programs and the expansion of insurance programs for
the uninsured and underinsured.§5-16D-29. Sunset provision.
The Office of the Pharmaceutical Advocate, the Pharmaceutical
Advocate and the Pharmaceutical Advocate Advisory Council shall
continue to exist, pursuant to the provisions of article ten,
chapter four of this code, until the first day of July, two
thousand eight, unless sooner terminated, continued or
reestablished pursuant to the provisions of that article.§5-16D-30. Severability.If any provision of this article is held to be
unconstitutional or void, the remaining provisions of this article
remain valid, unless the court finds the valid provisions are so
essentially and inseparable connected with, and so dependent upon,
the unconstitutional or void provisions that the court cannot
presume the Legislature would have enacted the remaining valid
provisions without the unconstitutional or void provision, or
unless the court finds the remaining valid provisions, standing
alone, are incomplete and are incapable of being executed in
accordance with the legislative intent.

CHAPTER 5F. ORGANIZATION OF THE EXECUTIVE BRANCH

OF STATE GOVERNMENT.

ARTICLE 2. TRANSFER OF AGENCIES AND BOARDS.
5F-2-2. Power and authority of secretary of each department.
(a) Notwithstanding any other provision of this code to the
contrary, the secretary of each department shall have plenary power
and authority within and for the department to:
(1) Employ and discharge within the office of the secretary such employees as may be necessary to carry out the functions of
the secretary, which employees shall serve at the will and pleasure
of the secretary;
(2) Cause the various agencies and boards to be operated
effectively, efficiently and economically, and develop goals,
objectives, policies and plans that are necessary or desirable for
the effective, efficient and economical operation of the
department;
(3) Eliminate or consolidate positions, other than positions
of administrators or positions of board members, and name a person
to fill more than one position;
(4) Delegate, assign, transfer or combine responsibilities or
duties to or among employees, other than administrators or board
members;
(5) Reorganize internal functions or operations;
(6) Formulate comprehensive budgets for consideration by the
Governor, and transfer within the department funds appropriated to
the various agencies of the department which are not expended due
to cost savings resulting from the implementation of the provisions
of this chapter: Provided, That no more than twenty-five percent
of the funds appropriated to any one agency or board may be
transferred to other agencies or boards within the department:
Provided, however, That no funds may be transferred from a special
revenue account, dedicated account, capital expenditure account or
any other account or funds specifically exempted by the Legislature
from transfer, except that the use of appropriations from the State Road Fund transferred to the Office of the Secretary of the
Department of Transportation is not a use other than the purpose
for which such funds were dedicated and is permitted: Provided
further, That if the Legislature by subsequent enactment
consolidates agencies, boards or functions, the secretary may
transfer the funds formerly appropriated to such agency, board or
function in order to implement such consolidation. The authority
to transfer funds under this section shall expire on the thirtieth
day of June, one thousand ninety hundred eighty-ninetwo thousand
six;
(7) Enter into contracts or agreements requiring the
expenditure of public funds, and authorize the expenditure or
obligating of public funds as authorized by law: Provided, That
the powers granted to the secretary to enter into contracts or
agreements and to make expenditures or obligations of public funds
under this provision shall not exceed or be interpreted as
authority to exceed the powers heretofore granted by the
Legislature to the various commissioners, directors or board
members of the various departments, agencies or boards that
comprise and are incorporated into each secretary's department
under this chapter;
(8) Acquire by lease or purchase property of whatever kind or
character and convey or dispose of any property of whatever kind or
character as authorized by law: Provided, That the powers granted
to the secretary to lease, purchase, convey or dispose of such
property shall not exceed or be interpreted as authority to exceed the powers heretofore granted by the Legislature to the various
commissioners, directors or board members of the various
departments, agencies or boards that comprise and are incorporated
into each secretary's department under this chapter;
(9) Conduct internal audits;
(10) Supervise internal management;
(11) Promulgate rules, as defined in section two, article one,
chapter twenty-nine-a of this code, to implement and make effective
the powers, authority and duties granted and imposed by the
provisions of this chapter, such promulgation to be in accordance
with the provisions of chapter twenty-nine-a of this code;
(12) Grant or withhold written consent to the proposal of any
rule, as defined in section two, article one, chapter twenty-nine-a
of this code, by any administrator, agency or board within the
department, without which written consent no proposal of a rule
shall have any force or effect;
(13) Delegate to administrators such duties of the secretary
as the secretary may deem appropriate from time to time to
facilitate execution of the powers, authority and duties delegated
to the secretary; and
(14) Take any other action involving or relating to internal
management not otherwise prohibited by law.
(b) The secretaries of the departments hereby created shall
engage in a comprehensive review of the practices, policies and
operations of the agencies and boards within their departments to
determine the feasibility of cost reductions and increased efficiency which may be achieved therein, including, but not
limited to, the following:
(1) The elimination, reduction and restrictions in the use of
the state's vehicle or other transportation fleet;
(2) The elimination, reduction and restrictions in the
preparation of state government publications, including annual
reports, informational materials and promotional materials;
(3) The termination or rectification of terms contained in
lease agreements between the state and private sector for offices,
equipment and services;
(4) The adoption of appropriate systems for accounting,
including consideration of an accrual basis financial accounting
and reporting system;
(5) The adoption of revised procurement practices to
facilitate cost-effective purchasing procedures, including
consideration of means by which domestic businesses may be assisted
to compete for state government purchases; and
(6) The computerization of the functions of the state agencies
and boards.
(c) Notwithstanding the provisions of subsections (a) and (b)
of this section, none of the powers granted to the secretaries
herein shall be exercised by the secretary if to do so would
violate or be inconsistent with the provisions of any federal law
or regulation, any federal-state program or federally delegated
program or jeopardize the approval, existence or funding of any
such program and the powers granted to the secretary shall be so construed.
(d) The layoff and recall rights of employees within the
classified service of the state as provided in subsections five and
six, section ten, article six, chapter twenty-nine of this code
shall be limited to the organizational unit within the agency or
board and within the occupational group established by the
classification and compensation plan for the classified service of
the agency or board in which the employee was employed prior to the
agency or board's transfer or incorporation into the department:
Provided, That the employee shall possess the qualifications
established for the job class. The duration of recall rights
provided in this subsection shall be limited to two years or the
length of tenure, whichever is less. Except as provided in this
subsection, nothing contained in this section shall be construed to
abridge the rights of employees within the classified service of
the state as provided in sections ten and ten-a, article six,
chapter twenty-nine of this code, or the right of classified
employees of the Board of Regents to the procedures and protections
set forth in article twenty-six-b, chapter eighteen of this code.(e) Notwithstanding any provision of this code to the contrary
the secretary of each department with authority over programs which
are payors for prescription drugs, including but not limited to,
the Public Employees Insurance Agency, the Children's Health
Insurance Program, the Division of Corrections, the Division of
Juvenile Services, the Regional Jail and Correctional Facility
Authority, the Workers' Compensation Fund, state colleges and universities, public hospitals, state or local institutions such as
nursinghomes, veteran's homes, the Division of Rehabilitation,
public health departments and the Bureau of Medical Services or
other programs which are payors for prescription drugs, shall
cooperate with the Office of the Pharmaceutical Advocate
established pursuant to section four, article sixteen-d, chapter
five of this code for the purpose of purchasing prescription drugs
for any program over which they have authority.

CHAPTER 29. MISCELLANEOUS BOARDS AND COMMISSIONS.
ARTICLE 22. STATE LOTTERY ACT. §29-22-18a. State Excess Lottery Revenue Fund.
(a) There is continued a special revenue fund within the State
Lottery Fund in the State Treasury which is designated and known as
the "State Excess Lottery Revenue Fund." The Fund consists of all
appropriations to the Fund and all interest earned from investment
of the Fund and any gifts, grants or contributions received by the
Fund. All revenues received under the provisions of sections ten-b
and ten-c, article twenty-two-a of this chapter and under article
twenty-two-b of this chapter, except the amounts due the Commission
under section 29-22B-1408(a)(1) of this chapter, shall be deposited
in the State Treasury and placed into the "State Excess Lottery
Revenue Fund." The revenue shall be disbursed in the manner
provided in this section for the purposes stated in this section
and shall not be treated by the Auditor and the State Treasurer as
part of the general revenue of the state.
(b) For the fiscal year beginning the first day of July, two thousand two, the Commission shall deposit: (1) Sixty-five million
dollars into the subaccount of the State Excess Lottery Revenue
Fund hereby created in the State Treasury to be known as the
"General Purpose Account" to be expended pursuant to appropriation
of the Legislature; (2) ten million dollars into the Education
Improvement Fund for appropriation by the Legislature to the
"Promise Scholarship Fund" created in section seven, article seven,
chapter eighteen-c of this code; (3) nineteen million dollars into
the Economic Development Project Fund created in subsection (d) of
this section for the issuance of revenue bonds and to be spent in
accordance with the provisions of said subsection; (4) twenty
million dollars into the School Building Debt Service Fund created
in section six, article nine-d, chapter eighteen of this code for
the issuance of revenue bonds; (5) forty million dollars into the
West Virginia Infrastructure Fund created in section nine, article
fifteen-a, chapter thirty-one of this code, to be spent in
accordance with the provisions of said article; (6) ten million
dollars into the Higher Education Improvement Fund for higher
education; and (7) five million dollars into the State Park
Improvement Fund for park improvements. For the fiscal year
beginning the first day of July, two thousand three, the Commission
shall deposit: (1) Sixty-five million dollars into the General
Purpose Account to be expended pursuant to appropriation of the
Legislature; (2) seventeen million dollars into the Education
Improvement Fund for appropriation by the Legislature to the
"Promise Scholarship Fund" created in section seven, article seven, chapter eighteen-c of this code; (3) nineteen million dollars into
the Economic Development Project Fund created in subsection (d) of
this section for the issuance of revenue bonds and to be spent in
accordance with the provisions of said subsection; (4) twenty
million dollars into the School Building Debt Service Fund created
in section six, article nine-d, chapter eighteen of this code for
the issuance of revenue bonds; (5) forty million dollars into the
West Virginia Infrastructure Fund created in section nine, article
fifteen-a, chapter thirty-one of this code, to be spent in
accordance with the provisions of said article; (6) ten million
dollars into the Higher Education Improvement Fund for higher
education; and (7) five million dollars into the State Park
Improvement Fund for park improvements.
(c) For the fiscal year beginning the first day of July, two
thousand four, and subsequent fiscal years, the Commission shall
deposit: (1) Sixty-five million dollars into the General Purpose
Account to be expended pursuant to appropriation of the
Legislature; (2) twenty-seven million dollars into the Education
Improvement Fund for appropriation by the Legislature to the
"Promise Scholarship Fund" created in section seven, article seven,
chapter eighteen-c of this code; (3) nineteen million dollars into
the Economic Development Project Fund created in subsection (d) of
this section for the issuance of revenue bonds and to be spent in
accordance with the provisions of said subsection; (4) nineteen
million dollars into the School Building Debt Service Fund created
in section six, article nine-d, chapter eighteen of this code for the issuance of revenue bonds; (5) forty million dollars into the
West Virginia Infrastructure Fund created in section nine, article
fifteen-a, chapter thirty-one of this code to be spent in
accordance with the provisions of said article; (6) ten million
dollars into the Higher Education Improvement Fund for higher
education; and (7) five million dollars into the State Park
Improvement Fund for park improvements. No portion of the
distributions made as provided in this subsection and subsection
(b) of this section, except distributions made in connection with
bonds issued under subsection (d) of this section, may be used to
pay debt service on bonded indebtedness until after the Legislature
expressly authorizes issuance of the bonds and payment of debt
service on the bonds through statutory enactment or the adoption of
a concurrent resolution by both houses of the Legislature. Until
subsequent legislative enactment or adoption of a resolution that
expressly authorizes issuance of the bonds and payment of debt
service on the bonds with funds distributed under this subsection
and subsection (b) of this section, except distributions made in
connection with bonds issued under subsection (d) of this section,
the distributions may be used only to fund capital improvements
that are not financed by bonds and only pursuant to appropriation
of the Legislature.
(d) The Legislature finds and declares that in order to
attract new business, commerce and industry to this state, to
retain existing business and industry providing the citizens of
this state with economic security and to advance the business prosperity of this state and the economic welfare of the citizens
of this state, it is necessary to provide public financial support
for constructing, equipping, improving and maintaining economic
development projects, capital improvement projects and
infrastructure which promote economic development in this state.
(1) The West Virginia Economic Development Authority created
and provided for in article fifteen, chapter thirty-one of this
code shall, by resolution, in accordance with the provisions of
this article and article fifteen, chapter thirty-one of this code,
and upon direction of the Governor, issue revenue bonds of the
Economic Development Authority in no more than two series to pay
for all or a portion of the cost of constructing, equipping,
improving or maintaining projects under this section or to refund
the bonds at the discretion of the Authority. Any revenue bonds
issued on or after the first day of July, two thousand two, which
are secured by state excess lottery revenue proceeds shall mature
at a time or times not exceeding thirty years from their respective
dates. The principal of, and the interest and redemption premium,
if any, on the bonds shall be payable solely from the special fund
provided in this section for the payment.
(2) There is continued in the State Treasury a special revenue
fund named the "Economic Development Project Fund" into which shall
be deposited on and after the first day of July, two thousand two,
the amounts to be deposited in said Fund as specified in
subsections (b) and (c) of this section. The Economic Development
Project Fund shall consist of all such moneys, all appropriations to the Fund, all interest earned from investment of the Fund and
any gifts, grants or contributions received by the Fund. All
amounts deposited in the Fund shall be pledged to the repayment of
the principal, interest and redemption premium, if any, on any
revenue bonds or refunding revenue bonds authorized by this
section, including any and all commercially customary and
reasonable costs and expenses which may be incurred in connection
with the issuance, refunding, redemption or defeasance thereof.
The West Virginia Economic Development Authority may further
provide in the resolution and in the trust agreement for priorities
on the revenues paid into the Economic Development Project Fund as
may be necessary for the protection of the prior rights of the
holders of bonds issued at different times under the provisions of
this section. The bonds issued pursuant to this subsection shall
be separate from all other bonds which may be or have been issued
from time to time under the provisions of this article.
(3) After the West Virginia Economic Development Authority has
issued bonds authorized by this section and after the requirements
of all funds have been satisfied, including any coverage and
reserve funds established in connection with the bonds issued
pursuant to this subsection, any balance remaining in the Economic
Development Project Fund may be used for the redemption of any of
the outstanding bonds issued under this subsection which, by their
terms, are then redeemable or for the purchase of the outstanding
bonds at the market price, but not to exceed the price, if any, at
which redeemable, and all bonds redeemed or purchased shall be immediately canceled and shall not again be issued.
(4) Bonds issued under this subsection shall state on their
face that the bonds do not constitute a debt of the State of West
Virginia; that payment of the bonds, interest and charges thereon
cannot become an obligation of the State of West Virginia; and that
the bondholders' remedies are limited in all respects to the
"special revenue fund" established in this subsection for the
liquidation of the bonds.
(5) The West Virginia Economic Development Authority shall
expend the bond proceeds from the revenue bond issues authorized
and directed by this section for such projects as may be certified
under the provision of this subsection: Provided, That the bond
proceeds shall be expended in accordance with the requirements and
provisions of article five-a, chapter twenty-one of this code and
either article twenty-two or twenty-two-a, chapter five of this
code, as the case may be: Provided, however, That if such bond
proceeds are expended pursuant to article twenty-two-a, chapter
five of this code and if the design-build board created under said
article determines that the execution of a design-build contract in
connection with a project is appropriate pursuant to the criteria
set forth in said article and that a competitive bidding process
was used in selecting the design builder and awarding such
contract, such determination shall be conclusive for all purposes
and shall be deemed to satisfy all the requirements of said
article.
(6) For the purpose of certifying the projects that will receive funds from the bond proceeds, a committee is hereby
established and comprised of the Governor, or his or her designee,
the Secretary of the Department of tax and Revenue, the Executive
Director of the West Virginia Development Office and six persons
appointed by the Governor: Provided, That at least one citizen
member must be from each of the state's three congressional
districts. The committee shall meet as often as necessary and make
certifications from bond proceeds in accordance with this
subsection. The committee shall meet within thirty days of the
effective date of this section.
(7) Applications for grants submitted on or before the first
day of July, two thousand two, shall be considered refiled with the
committee. Within ten days from the effective date of this section
as amended in the year two thousand three, the lead applicant shall
file with the committee any amendments to the original application
that may be necessary to properly reflect changes in facts and
circumstances since the application was originally filed with the
committee.
(8) When determining whether or not to certify a project, the
committee shall take into consideration the following:
(A) The ability of the project to leverage other sources of
funding;
(B) Whether funding for the amount requested in the grant
application is or reasonably should be available from commercial
sources;
(C) The ability of the project to create or retain jobs, considering the number of jobs, the type of jobs, whether benefits
are or will be paid, the type of benefits involved and the
compensation reasonably anticipated to be paid persons filling new
jobs or the compensation currently paid to persons whose jobs would
be retained;
(D) Whether the project will promote economic development in
the region and the type of economic development that will be
promoted;
(E) The type of capital investments to be made with bond
proceeds and the useful life of the capital investments; and
(F) Whether the project is in the best interest of the public.
(9) No grant may be awarded to an individual or other private
person or entity. Grants may be awarded only to an agency,
instrumentality or political subdivision of this state or to an
agency or instrumentality of a political subdivision of this state.
The project of an individual or private person or entity may be
certified to receive a low-interest loan paid from bond proceeds.
The terms and conditions of the loan, including, but not limited
to, the rate of interest to be paid and the period of the
repayment, shall be determined by the Economic Development
Authority after considering all applicable facts and circumstances.
(10) Prior to making each certification, the committee shall
conduct at least one public hearing, which may be held outside of
Kanawha County. Notice of the time, place, date and purpose of the
hearing shall be published in at least one newspaper in each of the
three congressional districts at least fourteen days prior to the date of the public hearing.
(11) The committee may not certify a project unless the
committee finds that the project is in the public interest and the
grant will be used for a public purpose. For purposes of this
subsection, projects in the public interest and for a public
purpose include, but are not limited to:
(A) Sports arenas, fields parks, stadiums and other sports and
sports-related facilities;
(B) Health clinics and other health facilities;
(C) Traditional infrastructure, such as water and wastewater
treatment facilities, pumping facilities and transmission lines;
(D) State-of-the-art telecommunications infrastructure;
(E) Biotechnical incubators, development centers and
facilities;
(F) Industrial parks, including construction of roads, sewer,
water, lighting and other facilities;
(G) Improvements at state parks, such as construction,
expansion or extensive renovation of lodges, cabins, conference
facilities and restaurants;
(H) Railroad bridges, switches and track extension or spurs on
public or private land necessary to retain existing businesses or
attract new businesses;
(I) Recreational facilities, such as amphitheaters, walking
and hiking trails, bike trails, picnic facilities, restrooms, boat
docking and fishing piers, basketball and tennis courts, and
baseball, football and soccer fields;
(J) State-owned buildings that are registered on the national
register of historic places;
(K) Retail facilities, including related service, parking and
transportation facilities, appropriate lighting, landscaping and
security systems to revitalize decaying downtown areas; and
(L) Other facilities that promote or enhance economic
development, educational opportunities or tourism opportunities
thereby promoting the general welfare of this state and its
residents.
(12) Prior to the issuance of bonds under this subsection, the
committee shall certify to the Economic Development Authority a
list of those certified projects that will receive funds from the
proceeds of the bonds. Once certified, the list may not thereafter
be altered or amended other than by legislative enactment.
(13) If any proceeds from sale of bonds remain after paying
costs and making grants and loans as provided in this subsection,
the surplus may be deposited in an account created in the State
Treasury to be known as the "Economic Development Project Bridge
Loan Fund" to be administered by the Economic Development Authority
created in article fifteen, chapter thirty-one of this code.
Expenditures from the Fund are not authorized from collections but
are to be made only in accordance with appropriation by the
Legislature and in accordance with the provisions of article three,
chapter twelve of this code and upon fulfillment of the provisions
of article two, chapter five-a of this code. Loan repayment
amounts, including the portion attributable to interest shall be paid into the Fund created in this subdivision.
(e) If the Commission receives revenues in an amount that is
not sufficient to fully comply with the requirements of subsections
(b), (c) and (h) of this section, the Commission shall first make
the distribution to the Economic Development Project Fund; second,
make the distribution or distributions to the other funds from
which debt service is to be paid; third, make the distribution to
the Education Improvement Fund for appropriation by the Legislature
to the Promise Scholarship Fund; and fourth, make the distribution
to the General Purpose Account: Provided, That, subject to the
provisions of this subsection, to the extent such revenues are not
pledged in support of revenue bonds which are or may be issued from
time to time under this section, the revenues shall be distributed
on a pro rata basis.
(f) For the fiscal year beginning on the first day of July,
two thousand two, and each fiscal year thereafter, the Commission
shall, after meeting the requirements of subsections (b), (c) and
(h) of this section and after transferring to the State Lottery
Fund created under section eighteen of this article an amount equal
to any transfer from the State Lottery Fund to the Excess Lottery
Fund pursuant to subsection (f), section eighteen of this article,
deposit fifty percent of the amount by which annual gross revenue
deposited in the State Excess Lottery Revenue Fund exceeds two
hundred twenty-five million dollars in a fiscal year in a separate
account in the State Lottery Fund to be available for appropriation
by the Legislature.
(g) When bonds are issued for projects under subsection (d) of
this section or for the School Building Authority, infrastructure,
higher education or park improvement purposes described in this
section that are secured by profits from lotteries deposited in the
State Excess Lottery Revenue Fund, the Lottery Director shall
allocate first to the Economic Development Project Fund an amount
equal to one tenth of the projected annual principal, interest and
coverage requirements on any and all revenue bonds issued, or to be
issued, on or after the first day of July, two thousand two, as
certified to the Lottery Director; and second, to the fund or funds
from which debt service is paid on bonds issued under this section
for the School Building Authority, infrastructure, higher education
and park improvements an amount equal to one tenth of the projected
annual principal, interest and coverage requirements on any and all
revenue bonds issued, or to be issued, on or after the first day of
April, two thousand two, as certified to the Lottery Director. In
the event there are insufficient funds available in any month to
transfer the amounts required pursuant to this subsection, the
deficiency shall be added to the amount transferred in the next
succeeding month in which revenues are available to transfer the
deficiency.
(h) In fiscal year two thousand four and thereafter, prior to
the distributions provided in subsection (c) of this section, the
Lottery Commission shall deposit into the General Revenue Fund
amounts necessary to provide reimbursement for the refundable
credit allowable under section twenty-one, article twenty-one, chapter eleven of this code.
(i) (1) The Legislature considers the following as priorities
in the expenditure of any surplus revenue funds:
(A) Providing salary and/or increment increases for
professional educators and public employees;
(B) Providing adequate funding for the Public Employees
Insurance Agency; and
(C) Providing funding to help address the shortage of
qualified teachers and substitutes in areas of need, both in number
of teachers and in subject matter areas.
(2) The provisions of this subsection may not be construed by
any court to require any appropriation or any specific
appropriation or level of funding for the purposes set forth in
this subsection.(j) The Legislature further directs the governor to focus
resources on the creation of a prescription drug program for senior
citizens by pursuing a medicaid waiver to offer prescription drug
services to senior citizens; by investigating the establishment of
purchasing agreements with other entities to reduce costs; by
providing discount prices or rebate programs for seniors; by
coordinating programs offered by pharmaceutical manufacturers that
provide reduced cost or free drugs; by coordinating a collaborative
effort among all state agencies to ensure the most efficient and
cost effective program possible for the senior citizens of this
state; and by working closely with the state's congressional
delegation to ensure that a national program is implemented. The Legislature further directs that the governor report his progress
back to the joint committee on government and finance on an annual
basis beginning in November of the year two thousand one until a
comprehensive program has been fully implemented.
NOTE: The purpose of this bill would implement the
recommendations of the West Virginia Pharmaceutical Cost Council
created during the 2004 regular session of the Legislature. These
recommendations include the creation of the Office of the
Pharmaceutical Advocate. This Office would be headed by a
Pharmaceutical Advocate. This would be a cabinet level position
with managerial and administrative duties over the Office. An
advisory council to be known as the Pharmaceutical Advocate
Advisory Council is also created to offer input and guidance to the
Office and the Pharmaceutical Advocate. The Office would have the
sole responsibility for the purchase of prescription drugs for all
state entities and agencies who are payors for prescription drugs.
Other qualified entities may also be permitted to participate in
certain programs under the direction of the Pharmaceutical
Advocate.
This bill would also transfer all power currently vested in
other state entities for the purchase of prescription drugs to the
Office of the Pharmaceutical Advocate. The bill repeals the West
Virginia Pharmaceutical Cost Council and vests in the Office of the
Pharmaceutical Advocate most of the powers of that body.

Strike-throughs indicate language that is to be stricken from
the present law and underscoring indicates new language that would
be added.

§§5-16D-1 through -30 are new; therefore, strike-throughs and
underscoring have been omitted.